Cabinet effective August 1 will eliminate all credit checks on Canada Student Loan borrowers. “It only creates a barrier,” said loan managers at the Department of Employment.

“In reality it only creates a barrier for first time student financial assistance applicants aged 22 and older who have to pass the credit screening or deal with the administrative burden associated with submitting appeals,” the department wrote in a Regulatory Impact Analysis Statement. It estimated 80,000 students a year are subject to credit checks under a program dating from 1999.

“Less than one percent of those screened are initially rejected for student financial assistance due to poor credit,” wrote staff. “And 85 percent of those who appeal are ultimately approved.”